Ilcheong Yi / UNRISD** Jiyoung Kim / Soongsil University*** Hyuk-Sang Sohn / Kyung Hee University**** ABSTRACT This paper aims to contribute to the discussions on the development effectiveness through the examination of the two Asian cases of the Philippines and the Republic of Korea (hereafter, Korea) with a focus on aid and non-aid policy coherence and the mechanisms to create synergies of donors and recipients from a comprehensive perspective encompassing social as well as economic policies. Both countries were often compared with each other in the literature to describe and explain the developmental success of South Korea. This paper focuses on the interactions between the recipient and donor on the one hand and between aid and social and economic policies of recipient countries in the period 1945 – the 1980s. We show that institutional complementarity is a result of interactive process of politics and policies arguing that interactions between policies intermediated by political interests in recipient countries and interests and objectives of donor countries’ foreign policies also shape the nature, forms and degree of institutional complementarity. We also highlight historical legacies and institutional initial conditions lay institutional environment where institutional complementarity is formed and developed. * The authors would like to appreciate the staffs of the United Nations Research Institute for Social Development (UNRISD) for their lively discussions, which formed the basis of this work. We also thanks for the reviewers’ valuable comments that improved the manuscript. This work was supported by the Ministry of Education of the Republic of Korea and the National Research Foundation of Korea (NRF-2015S1A3A2046224). ** Lead author *** Corresponding author **** Co-author Aid Effectiveness and Institutional Complementarity: Comparative Study of the Philippines and Republic of Korea *